At the helm of an ecommerce business, you could be selling literally anything – but you need to get a hold of your products first. Inventory acquisition is one of the key factors that divide different ecommerce business models.
You could be offering anything from toothbrushes to mineral water, and from gas cylinder storage to bikes – the products need to be made and then sourced. How they are made and sourced offers a good means of categorizing such businesses.
To take some examples, there are companies that acquire some of their inventory through wholesale orders – purchasing in bulk and selling each product on for a low unit price – and there are companies that source a much smaller amount of specialist products and aim towards a large fulfilment and distribution reach so they can find as many customers as possible for products (which are typically large and infrequent purchases).
Then there are those ecommerce companies that manufacture goods themselves, with inventory acquisition being substituted for manufacture costs in the budget.
Furthermore, we can subdivide this latter group of businesses even further. There are ecommerce businesses that are also commercial or industrial manufacturers that make a lot of a product and sell them on, more often through the B2B model but often to customers as well. The other group is those businesses that sell DIY products, made at home by an individual or small team, and shipped onwards, often in direct response to a single order.
There are a few misconceptions about such businesses, so for success with this business model it is important to dispel these. Especially because a few of these misconceptions can make DIY ecommerce seem unfeasible or unprofitable. This is not necessarily the case.
Misconceptions About DIY Ecommerce
It is Only Small Companies
It is true that DIY businesses are often small – but not always. The unique thing about DIY product businesses is that being a small business with a limited inventory and fulfilment handled in house is not the disadvantage that it often is with other business types.
This is because DIY products benefit from a certain authentic appeal – the idea that the products are lovingly handmade on a small scale and that each one is different. Large businesses are associated with mass production, which is a negative association for DIY businesses.
This does not mean though that all these businesses are small. Many DIY product businesses attempt to expand and handle more orders without losing their authentic appeal. They do this by increasing order load and investing in third-party fulfilment without sourcing inventory from a third-party supplier.
But how can such businesses handle such order loads when they are still making the products themselves? One method is to source parts wholesale and finish the products off in-house (ensuring each is still unique); another is to hire more team members. Do this successfully and a DIY product business can grow and still retain its authentic appeal.
They Have Low Profit Margins
A DIY product or handcraft ecommerce company can certainly have low overall profits if they do not sell many products. But these businesses also have exceptionally low expenses. As mentioned, they do not need to invest in third-party fulfilment or source larger amounts of inventory. Moreover, while it depends how you measure the value of the work done to create the products, the materials are very often cheap, meaning large profit margins.
There Isn’t a Big Market
In fact, there is a very large market for all sorts of handmade and DIY products. Selling enough to see large profits is another matter, but most of the time demand is actually higher than “supply” for DIY businesses, which is why many do manage to expand.
So, it is clear that DIY ecommerce is more varied and scalable than many assume. Nonetheless, it is still true that it is one of the easiest businesses to get up and running and with the fewest monthly costs. All you really need is the talent to create desirable products, and the homemade cachet will go a long way to making them desirable.
DIY ecommerce can be a very good businesses to get into then. As with other ecommerce sites, you will of course require a good website, one that prioritizes the individual visitor and gives ample information about the products while taking care to stress that they are handmade.
Irrespective of whether your aim is to expand or not, there are none of the negative associations of in-house fulfilment when customers are looking for handmade items and crafts. As mentioned, the opposite is true, and being small, family-owned, and authentic is all gold for your marketing.
Here we arrive at a crucial point – something that you definitely should account for in your budget is marketing. With a limited fulfilment reach and likely niche products on your hands, you need to reach your customers. Furthermore, the cachet of authenticity should be fully exploited in your marketing content.
Tips for DIY Ecommerce
Any more detailed advice on how to start a DIY ecommerce business would depend on what is actually being sold. Nevertheless, here are some of the most popular crafts to sell via ecommerce:
Homemade toiletries and bath products are immensely popular, with the homemade part often suggesting additional health benefits. Bath bombs stand out though because there is a certain excitement and novelty to them. The fact that they have become known as “bombs” is part of that; it is just fun to throw one of these colorful globes into a bath and watch all the fizzing.
Specifically, scented ones. Candles work very well with this business model simply because the customers are often looking for an authentic scent from natural ingredients. So by making your own scent, your products can offer this.
We are talking here about T-shirts, throw pillows, bed duvets, and so on. A colorful and fun design and a unique message printed on a T-shirt or cushion again creates a unique product.
This is the one you have probably already heard about. Handmade jewelry is an incredibly popular choice of product for DIY ecommerce, and it is so because there’s always room in the market for new styles or design. The options really are endless here.
We could go on and on with this list, as there is a potentially limitless number of different products that can be handmade and which have an appeal for precisely that reason. That is why so many get in on DIY ecommerce – and so many succeed.